The government is expected to tell the VHI today or tomorrow that it can go ahead with a fee increase of about 9 per cent from September.
The company requested the increase in June, saying it was needed to offset the cost of medical inflation and the introduction of new services and technology.
VHI acting chief executive Mr Oliver Tattan told The Irish Times yesterday that no response had been received yet. However, it is likely that the Minister for Health and Children, Mr Cowen, will give the go-ahead for the increase.
"The Minister has until Friday to veto the fee rise", said a spokesman at the Department of Health and Children.
The VHI's most popular scheme is its Plan B, which is used by about half its 1.46 million customers. Should an increase of 9 per cent be allowed, this would lift the Plan B cost for a family of two adults and three children on an employer's group scheme from £875 annually to £953.75, before an income tax allowance.
Customers pay their premiums on a "renewal date basis", meaning that the new increase has to be paid by those who renew their insurance after September. Those who renew their account before September will pay the premium applicable since last September, which itself had increased 9 per cent. Mr Tattan said the request for a fee rise was related to an increased demand for medical care. "The issue is, what has increased medical consumption. We're saying people are consuming at least 9 per cent more [medical care]. "Medical inflation throughout the world grows at a greater rate than general inflation," he said.
The fact that some 350,000 customers had signed up in the past year for the VHI's Options plans, at greater expense, was proof of the increasing demand for medical services, said Mr Tattan.
